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Amit Sinha
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Monday, 29 September 2008 05:30 |
Is there a clear relationship between credit growth and market growth? The evidence is mixed.
The fastest growing cities out of 112 top cities of India | Growth rates (CAGR) | Market Size Growth Rate | Deposit Growth Rate | Credit Growth Rate | | Silvassa | 23 | 14 | 71 | | Gandhinagar | 22 | 10 | 54 | | Bokaro | 19 | 7 | -4 | | Surat | 17 | 11 | 18 | | Thiruvallur | 17 | 11 | 28 | | Agartala | 16 | 13 | 32 | | Chandigarh | 16 | 13 | 7 | | Thanjavur | 16 | 5 | 20 | | Kohima | 15 | 9 | 26 | | Noida | 15 | 28 | 43 |
The slowest growing cities out of 112 top cities of India | Growth rates (CAGR) | Market Size Growth Rate | Deposit Growth Rate | Credit Growth Rate | | Guntur | 8 | 7 | 16 | | Gwalior | 8 | 6 | 9 | | Jabalpur | 8 | 3 | 0 | | Nellore | 8 | 7 | 22 | | Varanasi | 8 | 6 | 13 | | Kanpur | 7 | 7 | 13 | | Kavaratti | 7 | | | | Vijayawada | 7 | 7 | 24 | | Dhanbad | 6 | 12 | 15 | | Kancheepuram | 2 | 16 | 22 |
With the exception of Bokaro, and to a certain extent Chandigarh, the 10 fastest growing cities grew on the back of high credit growth. However, this is not a general rule as a look at the slower growing cities reveal. Cities such as Vijaywada, Kancheepuram, Nellore and Guntur did not display a robust growth in spite of high credit growth. Deposit growth, on the other hand is an effect of market growth and in general grows in the wake of market growth. This is generally borne out by the facts, though a few notable exceptions exist – Thanjavur, Kohima, Bokaro (among the fast growing cities) and Dhanbad and Kancheepuram (slow growing cities) data source: Indicus Analytics Source: Freewheeling
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